FenSeg criticizes budget cuts for rural insurance.

The new freeze on funds for the Rural Insurance Premium Subsidy Program (PSR), announced by the federal government, has reinforced the insurance sector's concern about the lack of budgetary predictability for one of the main risk management policies in Brazilian agriculture. According to the National Federation of General Insurance (FenSeg), the instability in the allocation of resources compromises the planning of rural producers, insurers, and the government itself, hindering the expansion of protection in the field. The freeze affected R$ 461.7 million of the PSR budget for 2026. With this measure, of the R$ 1.1 billion initially planned for the program, approximately R$ 638 million remain available—of which R$ 100 million has already been used—to support the contracting of insurance by rural producers. This scenario gains even more relevance in a context of increasing exposure of Brazilian agriculture to extreme weather events. In this environment of greater uncertainty, FenSeg advocates for strengthening instruments to protect agricultural activity and building a long-term public policy for rural insurance. According to the president of FenSeg's Rural Insurance Commission, Daniel Nascimento, more worrying than the occurrence of an extreme weather event is the lack of predictability regarding the resources allocated to subsidizing rural insurance. “More worrying than the occurrence of a weather event, which today can be monitored and anticipated, is the uncertainty regarding the availability of resources allocated to subsidies. The new blocking of PSR resources highlights a problem that has compromised the expansion of protection in the countryside for years: the lack of budgetary predictability. Rural insurance is a risk management instrument that depends on long-term planning by producers, insurers, and the government itself,” he argues. According to Nascimento, the moment is especially sensitive because warnings about the formation of a new El Niño cycle indicate the possibility of severe weather events, with potential impact on different producing regions of the country. "Extreme weather phenomena are already part of the reality of Brazilian agriculture and, therefore, need to be incorporated into the planning of public policies." According to the FenSeg representative, without predictability, the capacity to expand insurance coverage is lost precisely when producers need protection the most. The effects of this instability can already be observed in the evolution of the area protected by the program. After reaching approximately 13.7 million hectares in 2021, the area insured with PSR support decreased to approximately 3.2 million hectares in 2025. For FenSeg, the reduction in coverage highlights the need to ensure greater predictability in public policy, allowing more producers to access risk management instruments in a scenario of increasing exposure to extreme weather events. "Brazil already protects a small portion of its agricultural area, and the continued blockages hinder the advancement of a public policy essential for food security, income stability in rural areas, and the resilience of Brazilian agribusiness," concludes Nascimento. According to FenSeg, the new cut to the PSR makes the advancement of the legislative agenda aimed at improving rural insurance even more relevant. The organization is closely monitoring the progress in the Federal Senate of Bill No. 2,951/2024, recently approved by the Chamber of Deputies. The proposal seeks to modernize the sector's legal framework, increase legal certainty, and create conditions for greater stability and predictability in the country's rural insurance policy. 

This text was translated by machine from Brazilian Portuguese.